William H. Rehnquist:

Christopher J. Wright:

Mr. Chief Justice, and may it please the Court:

The Army operates schools for the dependents of personnel stationed at Fort Stewart, Georgia.

This case arose when the union that represents the teachers at those schools made a number of proposals relating to wages and fringe benefits, including a proposal to increase wages across the board by 13.5 percent.

The Army refused to negotiate, relying on various provisions of the Federal Labor Management Relations statute and on a statute and a regulation specifically directed to the dependents' schools.

The FLRA held that the proposals are negotiable in a divided opinion, and the court of appeals affirmed.

We believe that the Army's refusal to bargain is justified for three reasons.

First, Congress did not make wages negotiable in the Federal sector.

Second, it instead gave agency management control of agency budgets.

And third, the salaries of teachers at the dependents' schools are to be set by comparison with the salaries of teachers at the local public schools.

Before I discuss those three reasons, I'd like to emphasize that it is undisputed that the vast majority of Federal employees may not bargain about pay.

The pay of most Federal employees is set by the general schedule and such employees, about a million and a half in all, are paid what Congress says in the general schedule they are paid.

The FLRA has changed its position with respect to another large group of employees--

William H. Rehnquist:

Mr. Wright, with respect to that first category of employees, is bargaining over their wages specifically excluded by the act, by the FLRA?

Christopher J. Wright:

--It... it works that way.

We... we... it is undisputed we think for three reasons.

A... there is nothing in the act that says general schedule employees cannot bargain about wages in so many words.

However, the portion of the act that makes... that mandates bargaining, says that bargaining is not permitted where a matter is specifically provided by Federal statute.

That is Section 7109(a)(14)(c).

In addition, Section 7117 provides that a proposal cannot be in conflict with a Federal law, and a... and a proposal to pay someone differently than what Congress has set in the Federal schedule would be contrary to law.

Both the union and the FLRA would agree with that I believe.

They would not agree with our third point that the management rights provision which gives management control of the agency budget also means that... that the pay of general schedule employees can't be set by statute.

Sandra Day O'Connor:

Mr. Wright, the... the employees whose wages are at issue here are not employees where Federal law sets their wage, as I understand it.

Christopher J. Wright:

That's correct.

We... we think that they are in many ways similar to prevailing rate employees.

Sandra Day O'Connor:

And before this statute was enacted, there was an executive order that provided substantially similar provisions?